WASHINGTON_Dubai Ports World, the company whose planned takeover of major U.S. port operations ignited a political firestorm earlier this year, has agreed to sell those operations to AIG Global Investment Group.
The company announced the deal Monday. The U.S. operations at six major U.S. seaports in New York/New Jersey, Philadelphia, Baltimore, Miami, Tampa and New Orleans were valued at approximately $700 million, but DP World did not disclose the sales price.
The deal also involves stevedoring operations in 16 locations along the eastern seaboard and Gulf Coast and a passenger terminal in New York City.
"While we are disappointed to be exiting the U.S. market, the price we received was fair," Sultan Ahmed Bin Sulayem, the chairman of DP World, said in a statement announcing the deal.
One of the loudest critics of the original deal said he was pleased and expected the deal to clear the few regulatory hurdles that remain.
"This is an appropriate final chapter to the book on the Dubai Ports World deal," said Sen. Charles Schumer, D-N.Y. "This is very likely to receive broad support in Washington and throughout America."
AIG Global Investment Group is an asset management firm with more than $635 billion in assets. The company's managing director Christopher Lee said the company is "very committed to ensuring that the company continues to be one of the industry leaders in setting standards for port security."
DP World is based in the United Arab Emirates and is the largest marine terminal operator with 51 terminals in 24 countries.
The sale still requires regulatory approval from several port authorities, including New York and New Jersey. The sale is expected to close in the next few months, DP World said.
The Bush administration had agreed last January to allow DP World to acquire the U.S. port operations, but as soon as the deal became public they were fiercely attacked by members of both political parties.
Critics of DP World cited the UAE's history, noting that some of the money that financed the Sept. 11 terror attacks moved through their banking system, and the government's past support of Afghanistan's Taliban government before the 2001 attacks.
As a result of the public pressure, DP World ultimately agreed to sell off the U.S. assets.
The Department of Homeland Security, which had tried to defend the initial DP World acquisition, had no comment Monday, agency spokesman Russ Knocke said.
Massachusetts Democrat Ed Markey, who sits on the House Homeland Security Committee, pledged his party would keep a closer eye on such deals in the future by conducting "the type of oversight that has been completely absent during the Republican Congress.
The outgoing chairman of that committee, Rep. Peter King, R-N.Y., said he was pleased DP World is "out of the picture" and replaced by an American-owned company.
"The lesson here is that anyone who's given a contract which affects homeland security has to be thoroughly investigated and examined when they're coming from a foreign country, but especially a country such as the United Arab Emirates," King said.
<<AP Online -- 12/12/06>>